Sale to the public sector and tenders in Ukraine.

In this article, we will describe how large projects are financed and how Ukrainian tenders work operate.

Sale of goods to the government of Ukraine.

Purchases of goods and services in Ukraine are regulated by state legislation. In accordance with the law, if the state plans to purchase goods in excess of US $ 4,500 or services in the amount of more than US $ 45,000, the government must open a tender in Ukraine, announce its opening and results.

In the event that purchases are financed by foreign organizations, the government is obliged to open an international tender. Ukrainian public procurement is governed by international treaties, in particular the WTO Agreement on Public Procurement, as well as Chapter 8 of Section IV of the Association Agreement with the EU.

Since August 1, 2016, the PROZORRO electronic procurement system has been introduced and is successfully operating in Ukraine. All state bodies of Ukraine are obliged to use the portal of this system for placing tenders. The Ukrainian PROZORRO system creates great opportunities for foreign companies that have the opportunity to participate in Ukrainian public procurement.

To resolve disputes and disagreements related to public procurement and tenders in Ukraine, an anti-monopoly committee and courts are working in the country.

Cases of violations of Ukrainian tendering operations must be filed with the courts no later than 10 days after the alleged violations. Foreign companies can also file a complaint with the Business Ombudsman Council of Ukraine, which is supported by the EBRD.

The post of business ombudsman in Ukraine is an important instrument of the Ukrainian state in the fight against corruption. The Business Ombudsman and his field representatives have the right to report complaints of unfair treatment and corruption. When the Ombudsman concludes that there may have been an abuse of office, he can request that investigations be initiated and that the complaints be reviewed by the government.

In addition to direct Ukrainian tenders, payment for purchases can be made from several multilateral banks, which provide assistance to Ukraine for the implementation of infrastructure projects. First of all, infrastructure projects increase the attractiveness of Ukraine in the eyes of foreign investors and suppliers.

Tender announcements for such infrastructure projects can be found on the websites of the European Bank for Reconstruction and Development (EBRD), the World Bank, the International Finance Corporation (IFC) and the United Nations Development Program (UNDP).

Multilateral Development Banks in Ukraine.

The largest foreign investor in the country is the European Bank for Reconstruction and Development (EBRD). The EBRD invests in debt and equity instruments in the financial sector, and finances small and medium-sized businesses. The EBRD provides investments to enterprises of municipal and state infrastructure and transport, food processing and processing, agricultural machinery, electricity generation, including nuclear energy. The United States is the largest investor in the EBRD. The total investment of the EBRD in Ukraine now is $ 17.6 billion, the current investment portfolio is about $ 4.8 million. In 2021, the EBRD plans to provide $ 2.1 billion and has already committed $ 1 billion, mainly to support the development of small and medium-sized businesses.

The World Bank provides grants and loans to the central government of Ukraine, banking institutions, energy companies, environmental and health care organizations, agriculture, trade and services. The World Bank also invests in the development of the private sector in Ukraine. Ukraine became a member of the World Bank in 1992; since then, the Bank’s commitments to the country have amounted to 13 billion US dollars in the framework of 70 programs and projects. Since May 2014, Ukraine has received more than $ 5 billion from the World Bank (including seven investment operations, one guarantee and four development loans). To date, the portfolio of investment projects of the World Bank in Ukraine is about 3.3 billion US dollars, 11 investment projects are being implemented.

Ukraine cooperates with the International Finance Corporation (IFC). Since 2004, IFC has invested $ 3.2 billion in Ukraine in 86 projects in agribusiness, energy efficiency and infrastructure.

IFC’s Ukrainian strategy for 2017-2021 is to create conditions for attracting foreign investment in the energy sector. IFC supports municipal projects aimed at the reconstruction of transport infrastructure, operational efficiency, energy efficiency, and opening up access to new markets.